When Will We See More ‘Shes’ in the C-Suite?

Women dominate health care as employees, consumers, and family “chief medical officers,” but not so much when it comes to leadership positions.

August 8, 2016

Howard Wolinsky

A woman at the top is unusual in Big Business in the United States and around the world. Only 5% of America’s largest businesses have women CEOs, according to several studies. Yet Mary Brainerd is at the helm of Bloomington, Minn.-based HealthPartners, the largest, consumer-governed, not-for-profit health care organization in the nation. The integrated health care organization serves more than 1.5 million members, has about 1,700 physicians in its care system, and 22,500 employees.

But there’s more at HealthPartners. The C-suite there has been dubbed the “She-suite.” Six of the nine executive staffers are women, including the CEO, chief administrative officer, the chief executive officer of Regions Hospital, the general counsel, the chief marketing officer, and the chief operating officer.

Although HealthPartners doesn’t have complete gender balance in the boardroom, female representation is well above average: 5 of 15 directors are women.

This hasn’t happened by accident. “HealthPartners has a long history of supporting gender balance in leadership,” says Brainerd, a former Blue Cross executive, who has led HealthPartners for nearly 15 years. “I have been fortunate to have been surrounded by some incredibly bright and talented women throughout my career here, and I work hard to encourage and support women leaders here and in the community.”

HealthPartners is an exception, modeling the gender balance that many advocates are calling for in the health insurance and managed care industry as well as throughout business. Hillary Clinton may be the next president, but it’s still very much a man’s world when it comes to the executive teams at major businesses. Only 11% of Fortune 500 senior leaders are female, while 38% of those companies have no women in their C-suites, and only 13% of global Fortune 500 companies have a female CEO, Fortune reported earlier this year.

Could the health care sector be different? Women dominate health care as consumers, decision makers for their families, and as employees. But they are less visible in the corridors of power. Women make up the majority of the medical workforce working in medical offices and hospitals and for health insurers and managed care companies. More than half of medical students are now women, so the gender balance among physicians is beginning to shift.

The Advisory Board reported in 2014 on the statistics on women in the health care industry:

More than 76% of hospital employees—women.

More than 77% of people who work in doctors’ offices—women.

More than 88% of home health workers—women.

The Kaiser Foundation reported in 2015 that the ratio of women to men in nursing is 9.5 to 1.

Women also dominate operations in the health insurance and managed care industry, such as enrollment, claims, and customer service, executives in health insurance observe. The federal Bureau of Labor Statistics reported in February that 59% of employees for insurance carriers overall are women.

Research has confirmed that while female representation is not balanced in business leadership, health insurance and managed care companies fare a bit better than average.

Michael Angelina, executive director of the Academy of Risk Management & Insurance at Saint Joseph’s University in Philadelphia, conducted studies in 2013 and 2015 examining the representation of women in the C-suites and on the boards of 100 insurance companies, including 22 in a combined life and health insurance group. He found that the insurance industry overall and the health insurance and managed care industry in particular fared better in gender parity than other companies and businesses in general. Angelina’s survey showed that in 2015, 10% of top executives (CEO, CFO, COO) of insurance companies were women, up from 6% in 2013.

Managed Care looked at the 10 largest national health insurance companies in the country based on revenue and found only two women chief executives, Paula Steiner, president and CEO of Chicago-based HCSC and Deborah Rice-Johnson, president of the Highmark Health Plan in Pittsburgh. We also found that 24% of executive leaders and 22% of board members at the largest health insurers are women.

Few women at the top

The number of women in leadership or executive positions at the 10 largest health insurers based on revenue.

Women

Total

Anthem

1

8

UnitedHealthCare

3

16

Aetna

2

12

Cigna

2

10

Kaiser

6

21

Humana

3

12

HCSC

4

13

Highmark

3

9

Blue Cross of California

3

13

Independence Blue Cross

1

6

Total

28

120

(23%)

Source: Company websites, accessed by Managed Care in July 2016. Company definition of leadership and executive positions were used for the tally.

In March, Weber Shandwick, the global communications firm in New York City, released its Gender Forward Pioneer Index showing that the most admired firms have more women in leadership roles. The index reveals that of the world’s 500 largest companies based on revenue only, 10.9% of senior executives are women. None of these firms has gender parity in senior leadership and nearly 40% had all-male leadership.

Leslie Gaines-Ross, chief reputation strategist at Weber Shandwick, said the health insurance and managed care industry did better than industry in general. She said 21% of senior executives are women in health insurance and managed care. “Because of that, we feel that the health care insurance sector is doing very well, being much closer to parity than the average company on the Global Fortune 500,” she said. Angelina, whose undergraduate program at Saint Joseph’s prepares students to work in the insurance industry, agreed that health and life insurers do better than other types of insurers in gender parity. He thinks that’s because these companies are more consumer-focused than the rest of the insurance industry.

It starts in the board room

Of course, boards of directors have considerable sway over the makeup of a company’s executive-level leaders, so the boardroom is a key place to look for gender diversity. Angelina found 17% of the 100 insurance boards had no women members, 17% had one, and 50% had two or more. Angelina is encouraged that he found a 35% increase in female representation on boards in two years, noting that there used to be 28 with zero women on the board. When Managed Care looked at the 10 largest insurance companies, it found Kaiser Permanente and HCSC had the largest percentage of women board members, 36% each.

Having women in positions of power may be especially important in health care—and health care insurance—because women have more interactions with the health care system than men. Women also tend to be the “chief medical officers” for their families, shouldering the burden of managing other people’s medications, making appointments, and paying the bills, notes Carolyn Buck Luce, executive in residence at the Center for Talent Innovation, a think tank in New York City that focuses on global talent strategies to overcome gender, sexual orientation, and other barriers. Buck Luce, who also teaches a course titled “Women and Power” at Columbia University’s Graduate School of International and Public Affairs, says it’s important for the leadership of any company, including health insurers and managed care companies, to mirror the company’s market so executives “really understand the unmet needs and customer preferences of both the current and future market.”

She is co-author of a Center for Talent Innovation report, “The Power of the Purse: Engaging Women Decision Makers for Healthy Outcomes,” sponsored by Aetna, Cardinal Health, and Merck and conducted in the U.S., the United Kingdom, Germany, Japan, and Brazil. The report, released in April 2015, found that 78% of women do not fully trust their insurance providers and 83% don’t fully trust pharmaceutical companies. By contrast, two thirds trust their doctors. Buck Luce said greater female involvement in health insurance governance ultimately could improve trust levels.

Just good business

A good gender mix may be important regardless of the business you are in. “One of the best arguments I have ever heard about diversity in business was a man who said, ‘If we want to find the best possible people to work at and eventually run our company, why would we eliminate 50% of the possible candidate pool before we get started?’” says Angela Braly, former chair and CEO of WellPoint. And the argument goes beyond this to the “bottom-line, metric-based case,” she says. Research by McKinsey and Credit Suisse has shown that companies with greater board diversity have a greater return on equity, a greater return on invested capital, and a greater return on sales, according to Braly. Other studies have come to the same conclusion. Last November, Bersin by Deloitte, a part of the consulting firm that focuses on human resources, said in its “Diversity and Inclusion Top the List of Talent Practices Linked to Stronger Financial Outcomes” study that implementing diversity and inclusion policies leads to 2.3 times higher cash flow per employee. And Catalyst, a New York City not-for-profit focused on providing opportunities for women in business, found that companies with higher female representation in top management deliver 34% greater returns to shareholders than those with lesser representation.

Brainerd, a philosophy major at the University of Minnesota who saw her future in health after a summer internship at the Minnesota Department of Health, said diversity of all kinds is needed, including gender, race, ethnicity, and sexual orientation. “In my view, the result is more business success,” she says.

Why wait?

What will it take to increase the numbers of women entering the C-suite in the health insurance and managed care industry? Vicky Gregg, former CEO of Blue Cross and Blue Shield of Tennessee, noted that many women join leadership in support roles, such as human resources and communications and as chief medical officers. “Women have to move into roles where they assume profit-and-loss responsibility. Some of that is changing a bit, and smaller health plans certainly give them the opportunity to move into those roles and hopefully to move up and assume larger roles in potentially the same or other organizations. But I think that move toward P & L is what has to happen.” More needs to be done to encourage women to earn degrees in finance and accounting, notes Gregg.

Educational opportunities might help to pry open doors and remove ceilings. Lisa Guertin, president of Anthem Blue Cross and Blue Shield in New Hampshire, notes that some of the women who work in operational areas don’t have college degrees, so she arranged a partnership with Southern New Hampshire University to pilot a competency-based, low-cost program called College of America for Anthem employees in New Hampshire. The program makes a degree possible for the nontraditional college student. Guertin, who started in operations, said the program could open promotion opportunities for the graduates.

Where is all this headed? Several campaigns have been launched around the world to increase female participation on corporate boards and in C-suites. Seventy-three percent of executives in the Weber Shandwick study estimated that the number of women in C-suite positions will match the number of men by 2030. Braly sounds a note of caution: “While I wish balance could be achieved more quickly, to be realistic, I know the process will take some time. But we must prepare a roadmap for going forward, and follow it. If we do that, real progress can be made.” She supports an idea proposed by the Committee for Economic Development, which in 2014 pointed out that if every other corporate seat opening were filled by a woman, then women would occupy a third of all board seats by 2018. “We’re already behind on their timeline, but it does show what could be achieved in a relatively short time if we have a clear and actionable plan,” she said.

Diane Holder, president and CEO of the University of Pittsburgh Health Plan, says, “We’re not in the Pony Express era any more. Why would it take to 2030? That’s about a half generation. That seems like very, very, slow progress,” she said.

Buck Luce is also impatient: “If you believe that [gender balance] is the best way to understand the unmet needs of customers today and in the future. The question is how quickly can you get there? Why wait until 2030 to achieve an important business objective?”